Panama Action a 'Catch-22' for Latin Relations

Moreover, he said, "Our longer-term problems in Panama haven't really been defined yet. There is going to be trouble down the road. The economy is very fragile. . . . We aren't sure yet how far to go in rebuilding the PDF (Panama Defense Forces).

"There is tension between the speed of the American withdrawal and what you do with the PDF," he continued. "If you rebuild the institution completely and reorient it toward a police function, that increases the load on the United States. The question is, how much does one rebuild?"

Bush said that he plans to withdraw the troops he dispatched to Panama last month "as soon as possible." But other officials, and analysts outside the government, said that a continuing U.S. military presence to remake the corrupt PDF may be the key to the survival of democracy in Panama.

The Administration may be able to withdraw most or all of the 14,000 combat troops who streamed into Panama before Christmas. But it also may have to send in other forces to train and assist the PDF in both military and police skills, they said.

"At this point, the United States is responsible for virtually all government services in Panama and for creating the democracy that we said we were going to restore," said Robert Kurz, a Central America expert at Washington's Brookings Institution. "If you act too quickly and take short cuts, you're going to undermine the goals you're after. . . . If you're in too much of a hurry, you're going to blow it."

"You have to break the back of the PDF," he added. "The PDF was not just Noriega. It was an octopus with tentacles in all parts of the government and the business world. It owned hotels, duty-free shops and a bank. If you don't dismantle that apparatus of corruption, you end up where you started."

Until now, however, U.S. military authorities in Panama have mapped out no clear course for reforming the PDF. Instead, in the interest of reconstituting a Panamanian police force as soon as possible, they have allowed most PDF officers to keep their jobs as long as they swear loyalty to the new Endara government.

Moreover, noted Richard Millett, a professor at Southern Illinois University, "American tutelage is going to be a very bitter pill for the Panamanian military to swallow."

At least since 1968, when charismatic Gen. Omar Torrijos seized power, Panama's military has defined its mission at least partly in terms of asserting Panamanian sovereignty over the U.S. troops who have been present in the country since the building of the Panama Canal.

"Endara is not going to get much recognition from other Latin countries until the (additional) U.S. troops are out," Millett said. "And he isn't going to get much legitimacy at home if he doesn't at least jab the United States in the ribs once in a while.

"Congress is going to be asked to provide him with plenty of economic aid, but we shouldn't expect too much gratitude over the long term," he added.